58-5 Considerations for Discontinuing Products, Departments or Stores Jim Bean Company has three product lines: D, E, and F. The following information is available: D E F Sales revenue $ 80,000 $42,000 $20,000 Variable expenses $ 40,000 $21,000 $12,000 Contribution margin $ 40,000 $21,000 $ 8,000 Fixed expenses $ 12,000 $15,000 $17,000 Operating income (loss) $ 28,000 $46,000 $19,000) (a) Jim Bean Company is thinking of discontinuing product line F because it is reporting an operating loss. All fixed expenses are unavoidable. Assuming Jim Bean Company discontinues product line F and does not replace it, what affect will this have on operating income? (b) Jim Bean Company is thinking of discontinuing product line F because it is reporting an operating loss. All fixed costs are unavoidable. Jim Bean Company discontinues product line F and rents the space formerly used to produce product F for $20,000 per year, what affect will this have on operating income